Indianapolis Area Real Estate Blog

What Caused the Housing Crisis?

Even as a REALTOR, I wonder, how did the climate of the real estate market change so dramatically in such a short period of time. The simple answer is, supply and demand.

When the supply of 'easy' loans were made available, the demand for such loans increased. As more people qualified, homes were quickly purchased, decreasing the supply of inventory, which increased the demand.

Everyone seemed to jump on the bandwagon and money was easy to get. Although Indianapolis did not have the same appreciation as many of the hotspots around the country, we are, nevertheless, experiencing the effects of the changes. We have our share of foreclosures and short sales, just not on a grandiose scale as some areas.

We have other issues here such as property taxes, which have affected homeowners. Still, the supply of easy money was the beginning.........along with the belief that real estate values would not go down.